MF holding %

21.03

Institutional holding %

50.80

City Union Bank Ltd. share price forecast

The 23 reports from 8 analysts offering long term price targets
for City Union Bank Ltd. have an average target of 210.25. The consensus estimate
represents an upside of 9.22%
from the last price of 192.50.

Net interest income grew by 15% and PAT grew by 15% YoY in Q3FY19 mainly led by consistent 17% YoY growth in loan book. Net Interest Margin (NIM) remained stable at 4.41% on a YoY basis and improved sequentially by 9 bps against 4.32% in Q2FY19 due to sequential increase in yield of funds and cost of funds. Deposit grew by 13% YoY in Q3FY19 in which CASA grew by 21% YoY. Asset quality improved with GNPA at 2.91% against 3.30% in Q3FY18, with NNPA and PCR stable at 1.74% and 65% respectively....

NII witnessed a continued pick-up in growth trajectory at 14.5% YoY to | 418 crore, in line with our estimate, led by healthy credit offtake Other income was at | 120 crore; down 1.5% YoY, lower than our estimate, attributable to a subdued treasury performance. Accordingly, operating profit was muted at | 307 crore, up 3.5% YoY Provisions were at | 79 crore, down 8.1% YoY & 16% QoQ. Lowerthan-expected tax outgo at | 50 crore, led earnings growth at 15.1% YoY to | 178.1 crore, broadly in line with our estimate Slippage remained higher at ~| 165 crore, led by one large...

We assign a target multiple of 3xDec-20E ABV to arrive at a TP of Rs 236. Maintain BUY. Yet again, CUBK performed consistently, across parameters. Loan growth was steady and broad based at 17%, fees grew ~16%, NIMs improved ~10bps sequentially, CASA (24%) and the PCR (65%) remained stable.

We believe, CUB with superior NIM, best return profile, grip on asset quality with greater bottom-line visibility over the medium term should continue to fetch higher multiple. Initiate BUY with a Target Price of Rs 228/sh (2.9x FY21E ABV ).

Net interest income grew by 12% and PAT grew by 16% YoY in Q2FY19 mainly led by consistent 17% YoY growth in loan book. NIM contracted 14bps to 4.32% against 4.46% in Q2FY18 due to 25bps decline in yield on funds against 21bps improvement in cost of funds YoY. Deposit grew by 12% YoY in Q2FY19 in which CASA grew by 15%....

NII increased 12.2% YoY to | 398 crore, in line with our estimate, led by healthy credit offtake. Margins came in at 4.32%, ~8 bps higher QoQ but remained 14 bps lower on a YoY basis Other income came in at | 119 crore; down 23.6% YoY, due to a subdued treasury performance. Accordingly, operating profit came in muted at | 296 crore, down 7.5% YoY Provisions were at | 68 crore, lowest in last eight quarters. This allowed PAT to come in line with estimate (| 168 crore, up 16% YoY)...

Maintain BUY with a revised TP of Rs 227 (3.0x Sept-20E ABV of Rs 75.5). CUBKs 2Q performance was in line with our estimates and was consistent across parameters sequentially. Growth was steady and broad based at 17% with a tilt towards the trader segment. Surprisingly, NIMs inched up 8bps QoQ with a drop in CoD. The QoQ dip in fees, after it rose sharply for 2 qtrs was expected.

Net interest income grew by 9.5% and PAT grew by 15% YoY in Q1FY19 mainly led by 17% YoY growth in loan book. NIM contracted by 23bps to 4.24% in Q1FY19 against 4.47% in Q1FY18 due to 93 bps decline in yield on advances. Deposit grew by 10% YoY in Q1FY19 in which CASA grew by 13%....

City Union Bank's NII increased 9.4% YoY to | 374.7 crore, lowest in the last few quarters. Previously, the trend was ~18% YoY growth in NII. This was largely owing to moderation in margins to 4.24% in Q1FY19, which in recent quarters was high at ~4.4%...

City Union Bank had announced a bonus issue in the ratio of 1:10. The exdate for the same is today i.e. July 10, 2018. Accordingly, the number of shares of the bank has increased from 66.5 crore to 73.5 crore. Thus, the share price has adjusted to | 174/share from yesterday's close of | 187/share. Hence, our earlier target price got revised to | 182/share from | 200/share earlier, post this corporate action. However, factoring in the bank's strong earnings trajectory even in this environment, we retain our positive stance on the bank and upgrade the target price to | 200 valuing at 2.6x revised ABV and maintain BUY rating....

Sector: Banks /Small-Cap | Earnings Update 4QFY18 Background: City Union Bank (CUB) among the smaller-sized banks in the private sector space operates a network of 600 branches. With about 2/3rds of its branches located in Tamil Nadu the bank's business is largely skewed towards the Southern India. Majority of its business comes from branches located in South India. CUB has a significant chunk...

NII came in line with estimate at | 368 crore (up 18.5% YoY). However, lower-than-expected operating expenses led to higher operating earnings of | 294 crore (I-direct estimate at | 285 crore) With asset quality under control, provisions were at ~| 86 crore,...